Neptune Developments has been granted planning approval from Knowsley Council to redevelop the shopping centre in Halewood.
The developer submitted plans in August to completely rebuild the shopping centre, anchored by a 17,000 sq ft Aldi supermarket and individual shopping units.
Knowsley Council said plans also include a new bus interchange facility, car parking and possibly a new pub or restaurant.
The £5.5m retail development completes the £16m regeneration of Halewood's Raven Court site, following the opening of the Halewood Centre in January last year.
Knowsley Council, NHS Knowsley and community services moved into the centre.
Cllr Dave Lonergan, Knowsley's cabinet member for regeneration, economy and skills, said: "A thriving shopping centre is crucial to the regeneration of Halewood. Local residents told us that they wanted an Aldi store so it's great that this will be delivered.
"The developers have also had a lot of interest from national and local traders who want to be part of the new centre."
Nick Kavanagh, Knowsley's executive director for regeneration, economy and skills, added: "Work has already begun to clear the old Raven Court shopping centre and prepare the site for redevelopment.
"Building work is expected to begin in the new year, which will create a vibrant shopping district for the Halewood community."